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CHAPTER 4: INVENTORY CONCEPT AND MANAGEMENT (INVENTORY CONCEPT (Definition…
CHAPTER 4: INVENTORY CONCEPT AND MANAGEMENT
INVENTORY CONCEPT
Definition
Inventory or stock is the goods and materials that a business holds for the ultimate goals to have a purpose of resale
Type of Inventory
:check: Raw Material
:check: Bought-out-parts (BOP) inventory
:check: Work-in-process inventory
:check: Finished goods inventory
:check: Maintenance, Repair & Operating Supplies
Inventory Technique
:check: Just in time
:check: ABC Analysis
:check: Stock Review
Inventory Cost
:check: Ordering cost
:check: Carrying Cost
:check: Shortage or Stock Out
Stage of Inventory
(i) Raw Material
(ii) Work-in-Process
(iii) Finished Goods
(iv) Cost of Goods Sold
INVENTORY MANAGEMENT
Definition
Inventory management is also the practice of overseeing and controlling of quantities of finished products for sale. A business inventory is one of its major assets and represents an investment that is tied up until the item sells.
Basic in Inventory Management
:check: Location
:check: Plan
:check: Identify
:check: Records
Costs that involved in Inventory Management
a) Human Capital Costs
b) Finance Costs
c) Management Costs
d) Procurement Cost
Strategic To Manage Better Inventory Management
• Vendor Management Inventory (VMI)
• Postponement Logistics
Service Classes Inventory Management
• Schedule Delivery
• Critical
• Non Critical